August 24, 2022
Daily Report 24/08/2022
The UK PMI manufacturing index declined sharply to a 27-month low of 46.0 for August from 52.1 previously and well below expectations of 51.0. The services-sector index declined only marginally to 52.5 from 52.6 and above market expectations of 52.0, although this was still the lowest reading for 18 months. Overall business optimism remained subdued with a net easing of cost and pricing pressures for the month as the rate of price increases slowed to a seven-month low. The CBI industrial orders index dipped to -7 for July from 8 previously and below expectations of 2. Orders overall were weak while inflation pressures remained strong. Sterling was able to recover some ground later in the day with the PMI data suggesting that the UK economy was relatively resilient in global terms.
No Key Data
The French PMI data overall was slightly weaker than expected with the composite index just below 50.0. German data was mixed with the manufacturing sector edging higher to 49.8 from 49.3 previously, but the services index dipped to 48.2 from 49.7 and below market expectations of 49.0. The Euro-Zone PMI manufacturing index declined marginally to a 26-month low of 49.7 from 49.8 and slightly stronger than expected with a slightly slower rate of output decline while the services-sector index dipped to a 17-month low of 50.2 from 51.2 and slightly below expectations. New orders declined and there was a second successive sharp increase in inventories. Supply-side pressures eased on the month and there was also a slower rate of increase in both costs and prices which will ease inflation pressure. The releases provided an element of relief and the Euro stabilised given speculation that there would be an even more severe downturn.
No Key Data
The US PMI manufacturing index retreated to a 25-month low of 51.3 for August from 52.2 previously and slightly below expectations of 52.0. The services-sector data was a notable shock with a further slide to a 27-month low of 44.1 from 47.3 previously. This was the second successive monthly contraction and well below consensus forecasts of 49.2. New orders were weaker with cost pressures also easing on the month and prices were increased at the slowest rate for 18 months.
13.30 Durable Goods Orders (Jul) Exp. 0.6% Prev. 2%
13.30 Nondefense Capital Goods Orders ex Aircraft (Jul) Exp. 0.3% Prev. 0.7%